Indian NBFC Veritas raises $27m Series D
Norwest Venture Partners has led a INR2 billion ($27.4 million) Series D round for Veritas Finance, an Indian non-banking finance company (NBFC) focused on micro, small, and medium-sized enterprises (MSMEs).
UK-based development finance institution CDC Group, which led Veritas’ $18.6 million Series B round last year, also participated in the funding round, along with Indian entrepreneur Surendra Pai. Veritas plans to use the new capital for geographic expansion and upgrades to its technology and credit appraisal systems.
Founded in 2015, Veritas has a loan book of INR5 billion and a customer base of over 21,000 MSMEs across seven states in India, according to a statement. The company aims to meet a wide spectrum of business credit needs, providing short-term loans for working capital, medium-term loans for business expansion, and long-term loans for asset creation.
Small businesses in India have historically faced challenges accessing credit from the country’s heavily regulated traditional banking system. NBFCs are seen as a way for such businesses to obtain credit and as a route for banks to indirectly access these borrowers. Veritas, like many NBFCs, claims to have developed proprietary technology-based tools to assess the creditworthiness of these borrowers, which often lack standard documentation.
Norwest has been investing in NBFCs since last year when it backed Five Star Business Finance, a business and housing finance provider. The firm has also participated in two funding rounds for automotive and small business lender Ess Kay Fincorp.
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